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  • Monger Gold (MMG) shares hit a yearly high as it expands its portfolio to lithium exploration through the acquisition of the Scotty lithium project in Nevada, USA
  • MMG has entered into an agreement to acquire American Consolidated Lithium, which holds the rights to acquire the tenements that make up the project
  • The acquisition will set MMG back $2 million, payable in shares over three stages and is subject to both confirmation from the ASX and shareholder approval
  • Monger says it has received binding commitments for a share placement to raise $1.7m which will fund initial work programs
  • Shares have been trading 53.6 per cent higher at 43 cents at 1:05 pm AEST

Monger Gold (MMG) shares rose to 55.3 cents in morning trade after announcing it is set to expand its portfolio to lithium exploration through the acquisition of the Scotty lithium project in the US state of Nevada.

The gold and nickel explorer today told investors it had entered into a binding agreement to acquire American Consolidated Lithium (ACL), which holds the rights to acquire the Scotty project through a purchase agreement with Playa Minerals.

The project adjoins the Bonnie Claire project which reportedly hosts one of the largest lithium resources in North America.

It is also situated 70 kilometres from the only producing lithium mine in the US and 330 kilometres from Tesla’s giga-factory.

Acquisition Consideration

The acquisition will set MMG back $2 million, payable in shares.

The material terms of the agreement will see the acquisition take place over three stages.

Initially, MMG will acquire 80 per cent of ACL through the issue of eight million shares at 25 cents each, along with four million options exercisable at 30 cents and expiring on July 6, 2024.

The second stage, to take on an a further 10 per cent, will see Monger issue nine million shares and 4.5 million options exercisable at 50 cents, expiring three years from the date of issue.

Lastly, for the final 10 per cent, MMG will transfer another nine million shares and 4.5 million options exercisable at 70 cents, also expiring three years from the issue date.

The third stage will also require either delineation of a JORC 2012 inferred mineral resource of at least 50 megatons at a grade of at least 1500 parts per million, or 500 megatons at a grade of at least 1000 parts per million.

The agreement is conditional upon both confirmation from the ASX and shareholder approval.

“We are delighted to secure the Scotty lithium project for our shareholders at a very modest upfront cost with the majority of the consideration contingent upon the delineation of a significant JORC (2012) resource of up to 500 megatons at a grade of at least 1000 parts per million lithium,” Chairman Peretz Schapiro said.

“This would be a very large resource — which illustrates the considerable upside of this acquisition.”

Exploration Plan

If given the go ahead, Monger has planned a systematic soil sampling program across the entire project area to take place in June.

Drill targets will be identified from assays of the soil geochemistry program and MMG plans to undertake drilling in the third quarter of this year.

Capital Raise

To help fund the acquisition and exploration work, MMG has tapped investors for $1.7 million.

The company said it received firm commitments for a share placement to sophisticated and professional investors which will see just over seven million shares issued at 25 cents each.

The issue price marks a 10.7 per cent discount to the company’s last traded price of 28 cents.

Issue of the shares is subject to shareholder approval and completion of the acquisition.

The company emerged from a trading halt today and shares were up 53.6 per cent, trading at 43 cents at 1:05 pm AEST.

MMG by the numbers
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